The two contrary opinions exist about relationship between technological innovation and institutional innovation.One opinion is that institutional innovation is dependent on technological innovation.Another is that technological innovation depends on institutional innovation.A new opinion is put forward,that is,technological innovation and institutional innovation are closely connected and propelled each other.At firstly,technological innovation needs a basis of appropriate institution.Secondly,institutional innovation is restricted by technology.In addition,a new answer to "conundrum of Joseph Needham" is given.